Australians may be bracing for tough news in next week's federal budget, but according to a new report by the OECD, when it comes to 35 other countries, life in Australia is actually very good.

In the latest OECD How's Life? report, Australia is rated as above average in all of the 11 life dimensions examined, with the exception of one: work-life balance.

Australia is rated as at the top when it comes to governance and civic engagement, and close to the top when it comes to environmental quality and health status.

Australia also rates in the top 20 per cent when it comes to housing, personal security and jobs and earnings. It rates above average in education and skills, subjective well-being, social connections and income and wealth.

But it trails other OECD countries when it comes to work-life balance, languishing in the bottom 20 per cent.

The sharemarket has closed higher after a volatile session. The benchmark S&P/ASX200 index rose 19.2 points, or 0.4 per cent, to 5481.4, while the broader All Ords gained 19.3 points, or 0.4 per cent, to 5462.7.

Among the sectors, financials added 0.3 per cent, materials gained 0.2 per cent and consumer discretionary added 0.7 per cent.

3:57pm on 6 May 2014

The legal ramifications following Sunday's brawl between Channel Nine boss David Gyngell and James Packer have taken a mysterious turn following the broadcast of an apparent mea culpa on the Nine Network today, clearly portraying the CEO as the instigator of the explosive kerbside brawl.

However, just hours after it aired the extraordinary admission from Gyngell, Nine was back-tracking, claiming no statement from Gyngell had been released and referring only to comments made on its news bulletin from senior reporter Tom Steinfort.

On Nine's morning news bulletin, Steinfort read a statement quoting a Channel Nine spokesman: "David Gyngell respects the job that police do and will co-operate fully with their investigation.

"He also fully accepts that he was instigator of the incident and that clearly if he had not turned up at Packer's premises in an angry mood then the confrontation would never have occurred."

The alleged statement was also picked up by rival network Channel Seven and aired on its news bulletins today.

However, a Channel Nine spokeswoman said no statement had been issued from the network on Gyngell's behalf, saying only that Gyngell will co-operate with police. The police confirmed earlier today they would be investigating the incident, giving rise to the possibility of Gyngell or Packer being charged with public affray.

If convicted of such a charge it would have serious consequences for both men, with criminal convictions effectively banning an individual from the office of chief executive.

James Packer sports a black eye as he leaves his Bondi Beach home on Tuesday morning. Photo: INFphoto.comBack to top

3:37pm on 6 May 2014

Climate data indicates an El Nino weather pattern is likely to emerge as early as July, the Bureau of Meteorology (BOM) says, adding that the chance of the event remains at 70 per cent.

The bureau said sub-surface sea temperatures had warmed by as much as 6 degrees in recent months.

Higher sea temperatures prompted an Australian climate scientist on Monday to warn that the weather event could be one of the strongest in nearly two decades.

El Nino - a warming of sea temperatures in the Pacific - affects wind patterns and can trigger both floods and drought in different parts of the globe, curbing food supply.

‘‘With Japan being shut and Hong Kong, there’s not a huge amount of volume,’’ says IG market strategist Evan Lucas. ‘‘People will start to look toward Yellen’s testimony tomorrow where she will keep the language very open.’’

3:09pm on 6 May 2014

The key change in the Reserve Bank's statement is on wages and unemployment, but it's incremental.

The central bank sounded a slightly more optimistic note on the jobs market, replacing its previous comments that the unemployment rate would "edge higher" to "risen somewhat".

The central bank added a new line noting that "more recently, there has been some improvement in indicators for the labour market, but it will probably be some time yet before unemployment declines consistently".

Barclays' chief economist for Australia Kieran Davies says the RBA would be pleased to see the slight improvement in the employment market according to figures from the Bureau of Statistics.

"I think they are relieved that the weakness in wages is coming through in the inflation numbers, but at the same time, the labour market is brighter than what they anticipated," Davies says.

2:40pm on 6 May 2014

The Australian dollar jumped more than a quarter of a cent to US93.17¢, matching its highest level this month, after the RBA's statement was released, even though it was almost identical to the April board statement.

The currency was trading at US92.83¢ just before 2.30pm.

The dollar in May.

2:36pm on 6 May 2014

Here's the RBA's statement - no big changes from last month's:

At its meeting today, the Board decided to leave the cash rate unchanged at 2.5 per cent.

Growth in the global economy was a bit below trend in 2013, but there are reasonable prospects of a better outcome this year, helped by firmer conditions in the advanced countries. China's growth appears to have slowed a little in early 2014 but remains generally in line with policymakers' objectives. Commodity prices in historical terms remain high, though some of those important to Australia have softened further of late.

In Australia, the economy grew at a below-trend pace in 2013. Recent information suggests moderate growth is occurring in consumer demand and foreshadows a strong expansion in housing construction. Some indicators of business conditions and confidence have improved from a year ago and exports are rising. But at the same time, resources sector investment spending is set to decline significantly and, at this stage, signs of improvement in investment intentions in other sectors are only tentative, as firms wait for more evidence of improved conditions before committing to expansion plans. Public spending is scheduled to be subdued.

The demand for labour has been weak over the past year and, as a result, the rate of unemployment has risen somewhat. More recently, there has been some improvement in indicators for the labour market, but it will probably be some time yet before unemployment declines consistently. Growth in wages has declined noticeably and this has been reflected more clearly in the latest price data, which show a moderation in growth in prices for non-traded goods and services. As a result, inflation is consistent with the target. If domestic costs remain contained, that should continue to be the case over the next one to two years, even with lower levels of the exchange rate.

Monetary policy remains accommodative. Interest rates are very low and savers continue to look for higher returns in response to low rates on safe instruments. Credit growth has picked up a little, while dwelling prices have increased significantly over the past year. The decline in the exchange rate from its highs a year ago will assist in achieving balanced growth in the economy, but less so than previously as a result of the rise over the past few months. The exchange rate remains high by historical standards.

Looking ahead, continued accommodative monetary policy should provide support to demand, and help growth to strengthen over time. Inflation is expected to be consistent with the 2–3 per cent target over the next two years.

In the Board's judgement, monetary policy is appropriately configured to foster sustainable growth in demand and inflation outcomes consistent with the target. On present indications, the most prudent course is likely to be a period of stability in interest rates.

The Reserve Bank has left the cash rate at a record low of 2.5 per cent for the ninth consecutive month, despite some encouraging signs of a pick-up in economic activity.

The decision to stay on the sidelines was widely expected by economists and financial markets.

Economists said the softer-than-expected reading of first-quarter inflation, which kept the rise in consumer prices within the RBA's target band of 2 to 3 per cent, had given the central bank some breathing room on when it might consider lifting the cash rate.

At the same time, analysts have said that expectations of a tight federal budget could see the Reserve Bank maintain its loose monetary policy settings and leave rates at 2.5 per cent for an extended period to continue stimulating the economy.

Financial markets have also wound back their rate hike expectations. While markets were pricing in a 88 per cent chance of a 25 basis points rate hike over the next 12 months in early April, they priced in a lower 52 per cent chance earlier on Tuesday, Credit Suisse data showed.

2:20pm on 6 May 2014

Here's a list of the issues we'll be looking out for in the RBA's monthly board meeting statement, which will be released in 10 minutes:

Inflation

The softer-than-expected reading of first-quarter inflation (0.6 per cent headline to take annual rate to 2.9 per cent; with underlying between 2.6 to 2.7 per cent year-on-year) after the surprise jump in consumer prices in the three months of last year have given the RBA more leeway in leaving the cash rate on hold for an extended period of time. Will the RBA acknowledge the softer figures and consider revising its forecasts?

Australian dollar

The softer inflation figures means the RBA has more flexibility in jawboning on the need for a weaker exchange rate. But analysts don't think they'll revive that tactic in this statement. They say the RBA could continue to note that the Australian dollar "remains high by historical standards", but was unlikely was to say that it is "uncomfortably high".

Housing boom

The Reserve Bank has continued to note that the low level of interest rates has seen dwelling prices "increase significantly" and that housing construction is set to expand. The housing boom seems to be easing slightly over the past month or so, but will the central bank express any increased concern about the overall strong growth in residential property prices?

Government spending

The RBA has repeatedly flagged its awareness that fiscal policy is expecting to tighten, noting in last month's statement that "public spending is scheduled to be subdued". Even so, the recent reports on what could be a raft of spending cuts in the budget next week could warrant an extended comment from the central bank on how that could impact on the economic transition.

Forward guidance on monetary policy

Lastly, the Reserve Bank has kept the same line on monetary policy since moving to a neutral stance in February, saying that "the most prudent course is likely to be a period of stability in interest rates". Analysts expect the RBA to maintain the same outlook, although there are mixed expectations on when the first rate hike could take place.

2:17pm on 6 May 2014

It's been a great run, pushing its share price into the stratosphere, but NIB just can't seem to crack the $3 level.

The shares have surged from to trade mid-afternoon at $2.99, a new peak which values the company at over $1.3 billion.

The driver has been speculation of a further lift to private health insurance numbers as the federal government seeks to stem a surging national health bill, and the likes of NIB, the sole-listed health insurer will be clear beneficiaries.

Its surge also points to the improving returns Canberra will garner from the planned sale of Medibank Private, its own health insurer. Optimism here has pushed the shares from $2.75 a week ago.

1:55pm on 6 May 2014

Andrew Forrest's busy week of spending has continued, with the billionaire topping up his holdings in Fortescue Metals Group in recent days.

Forrest has bought another 2 million shares for $9.74 million, according to a Fortescue statement today.

The purchase follows Forrest's $12 million investment into uranium explorer Energy and Minerals Australia on Monday, and his swoop on beef exporter Harvey Beef last week for between $30 million and $40 million.

Forrest already owns more than 33 per cent of Fortescue; a stake worth more than $5 billion.

Fortescue's share price - and the iron ore price (green line).

1:37pm on 6 May 2014

New rules phasing out billions of dollars in capital benefits received by ANZ, National Australia Bank and Commonwealth Bank are likely to dampen long-term returns from the lenders, analysts say.

It was revealed on Monday that the three banks will lose benefits they received from issuing debt through their wealth management units, under a new Australian Prudential Regulation Authority conglomerate policy taking effect from 2017.

Westpac is unaffected by the change because it does not hold this type of debt.

On Tuesday, analysts sought to determine which of the other three banks were most exposed to the change.

They said it would act as a further drag on returns alongside upcoming rules on ''domestic systemically-important banks'' (D-SIBs).

UBS analysts said ANZ and NAB would both see their tier one capital ratios fall to 8.55 per cent in 2016 as a result of the change, while CBA's would fall to 9.01 per cent.

Separately, APRA said in December that the big four banks would also be forced to increase their capital levels by about 1 percentage point to about 9 per cent from 2016 under its D-SIB policy.

Funds manager Mike Mangan of 2MG keeps a passing eye on some of the less salubrious aspects of banking in his newsletter for clients. His current missive deals with banks that are not just too big to fail, but “too big to jail”. More worryingly, he suggests some of them might also be “too big to save”.

Mangan’s quote of the day comes from New York prosecuting attorney Preet Bharara: “Financial institutions will do almost anything to avoid a tough enforcement action and therefore have a natural and powerful incentive to make prosecutors believe that death or dire consequences await.

"I have heard assertions made with great force and passion that if we take any criminal action, the skies will darken; the oceans will rise; nuclear winter will be upon us; and the world as we know it will end.”

Mangan takes that as Bharara’s admission of why no banks had faced criminal charges post-GFC despite incurring more than $US230 billion in fines and other restitutions.

“The lack of criminal changes allowed banks to assure their cheerleaders that they had done nothing wrong but settled ‘to put these matters behind them’,” he writes.

WTF? JPMorgan is among the banks Mangan says are not only tbtf (too big to fail) but may also be tbts (too big to save). Photo: Reuters

1:07pm on 6 May 2014

Despite being weaker than expected, the trade surplus in March continued a strong growth trend, economists say.

‘‘We’ve had three pretty solid surpluses for January, February and March,’’ National Australia Bank senior economist David de Garis says. ‘‘It’s a pretty solid start to the year and confirms a solid contribution from net exports to economic growth for the first quarter as well.’’

During March, exports fell by 2 per cent, while imports were flat.

CommSec economist Savanth Sebastian says the fall in the surplus was just a temporary setback, and he expects exports to grow as the year goes on:

Exports were down for the month, we’re seeing that rural exports were still strong though. I think we’re going to see ongoing surpluses.

It’s going to continue to grow, it’s going to continue to be a big income story.

Iron ore, coal and eventually LNG (liquefied natural gas) is going to get up as well.

12:48pm on 6 May 2014

The Australian dollar is holding up, shrugging off weaker-than-expected trade figures ahead of the Reserve Bank’s monthly interest rate decision.

The local currency rose to the day's high of 92.94 US cents after the trade data and is fetching 92.84 US cents, pretty much where it was late yesterday.

The trade surplus narrowed in March, driven by a fall in mining exports. The surplus of $731 million disappointed economists’ expectations of a $1 billion surplus.

‘‘We’ve had some relatively weak trade balance data but the market is shrugging that off,’’ Easy Forex currency dealer Tony Darvall says. ‘‘Expectations are for the RBA to remain on hold today but some of the language may change.

‘‘There’s been some quite upbeat economic data recently and it wouldn’t be surprising if they had a more hawkish tone. If they don’t try and jawbone the currency, we could see a rally.’’

12:18pm on 6 May 2014

Nickel has advanced to trade near a 15-month high on concern that global inventories are shrinking because of Indonesia’s export ban, while rising unrest in Ukraine adds to the risk of supply disruption from Russia.

The contract for delivery in three months climbed as much as 1.2 per cent to $US18,495 a metric tonne and is currently fetching $US18,469, putting it on course for the highest closing price since February 5, 2013.

Nickel is tipped to rally a further 20 per cent this year, a Bloomberg survey of analysts and traders showed. Prices for the best-performing industrial metal since January will climb to $US22,000 a metric tonne by the end of 2014, according to the survey.

‘‘Nickel is expected to keep its upward momentum with the destocking of nickel ores in China because of the policy in Indonesia,’’ says Celia Wang, a nickel analyst with Beijing Antaike Information Development Co.

While the Ukraine crisis is yet to curb supply, it is affecting prices because of the prospect of tougher economic sanctions against Russia, Wang says.

12:01pm on 6 May 2014

Australia could be in for an even bigger influx of Asian property investors amid predictions that an oversupply of housing in China will weigh on economic growth and force some investors to sell up in search of safer lands.

A string of economic data shows that China’s property market has been slowing with prices falling and investment growth turning negative in four of China’s 26 provinces in the first quarter of this year, while in two provinces it fell by 25 per cent compared to the same period the year before.

By comparison, Australian property prices have been gradually increasing, albeit at a slower pace last month, largely due to the support of record low interest rates at 2.5 per cent and increasing demand from cashed-up Asian property investors.

Westpac, which has just launched a new monthly survey into the behaviours of the Chinese consumer, expects that if China undergoes a property correction, more buyers will head to Australia. Says senior economist Huw McKay:

When the Chinese property market is not doing as well, and mainland investors decide to move their funds elsewhere, foreign real estate is seen as a very safe alternative.

We have seen a lot of interest by Chinese property investors both in Australia and in many major international markets.

Global investment manager Nomura has warned that China’s property market is headed for a correction and economic growth will slow to around 6 per cent, unless the government steps in.

“We argue the correction has been triggered by monetary policy tightening since mid-2013 and that the downtrend will continue unless policy tightening reverses into loosening,” Nomura research analysts said in a report on Chinese property on Monday.

Credit Suisse Equities Strategist, Hasan Tevfik also expects that problems in the China property will be positive for flows into Australia in the short-term:

Residents in Sydney and Melbourne are understanding that the rules of property prices are changing and should expect even more demand for local real-estate from Chinese investors as they look for a more stable store of wealth.

Globally desirable cities, like the major ones in Australia, will always be destinations for foreign capital.

In the longer term we know the property market in China has been a major source of wealth creation. We currently assume the Chinese will purchase $44 billion of Australian residential property between 2013 to 2020.